The Independent Bankers Association of America, which represents 7,800 small and medium-sized banks, has gone to court in an effort to stop the spread of nonbank banks.

In a suit filed in U.S. District Court in Jacksonville, Fla., last Friday against the comptroller of the currency, the banking association challenged his authority to charter any institution legally barred by the Bank Holding Company Act from exercising all powers of national banks, including taking demand deposits and making commercial loans.

About 100 nonbank banks, which forgo one or the other of those functions, have been approved this fall. Large banks and other financial companies have been opening nonbank banks around the country in direct competition with smaller banks. Florida banking associations have joined the suit as co-plaintiffs. That state recently banned any new nonbank banks for six months. Suit Challenges Non-Bank Banks

The Independent Bankers Association of America, which represents 7,800 small and medium-sized banks, has gone to court in an effort to stop the spread of nonbank banks.

In a suit filed in U.S. District Court in Jacksonville, Fla., last Friday against the comptroller of the currency, the banking association challenged his authority to charter any institution legally barred by the Bank Holding Company Act from exercising all powers of national banks, including taking demand deposits and making commercial loans.

About 100 nonbank banks, which forgo one or the other of those functions, have been approved this fall. Large banks and other financial companies have been opening nonbank banks around the country in direct competition with smaller banks. Florida banking associations have joined the suit as co-plaintiffs. That state recently banned any new nonbank banks for six months.